Budget 2022 will give a major boost to India's economic growth: Experts

The Union Budget 2022-23 has not only given a major impetus to economic development in the short run, but also in the long term.
Man at a showroom watch the live telecast of Finance Minister Nirmala Sitharaman's tabling of the Union Budget. (Photo | Ashwin Prasath, EPS)
Man at a showroom watch the live telecast of Finance Minister Nirmala Sitharaman's tabling of the Union Budget. (Photo | Ashwin Prasath, EPS)

The Union Budget 2022-23 has not only given a major impetus to economic development in the
short run, but also in the long term.

Increase in Public CapEx
The economy will get a major boost with the increase in public capital expenditure at Rs 7.50 lakh crore to fund various infrastructure projects in 2022-23, which is an increase of 35.4 per cent over the previous year. It helps in the creation of employment, increase in income, savings, consumption and effective demand due to the Multiplier effect. Studies have shown that the investment of one rupee in infrastructure will lead to an increase of income by Rs 2.50 in the same year. It will also augment private investment. Along with it, the Centre will also provide Rs 1 lakh crore as 50-year interest-free loans to states to boost the economy, which is above normal borrowings.

Modernisation of Agriculture
Agriculture is the key component for inclusive growth. One in two among the workforce still depend on agriculture for their livelihood. In order to increase productivity and create more jobs and thereby increase income in the agriculture sector, initiatives like value addition and branding of millet products, use of Kisan drones for crop assessment, land records, spraying of insecticides, encouraging start-ups, mechanisation, giving IT support will bring in a wave of technology in the agriculture sector.

Inclusivity in e-Education
Another sector that was worst affected due to the Covid-19 pandemic was education. The switch to virtual learning brought forth the digital divide and the lack of training in e-teaching among teachers led to a decline in the quality of education. Further, the country is all set to implement the National Education Policy 2020 all over the country which advocates an investment of 6 per cent of the GDP in education.

As an initial step, for the first time, budgeted expenditure on education is set to cross Rs 1 trillion. The Budget estimates for 2022-23 show that the government will spend Rs 1,04,278 crore in the coming fiscal on education. Initiatives like ‘One-Class-One-TV Channel’, and 200 channels to begin, high-quality digital content library in all vernacular languages so as to provide supplementary education in regional languages for Classes 1-12; setting up of Digital University, IITs in all states will have a great impact in improving the quality education and reduction of the digital divide.

New Avenues for Employment generation
The Animation, Visual Effects, Gaming and Comic (AVGC) sector will provide a huge opportunity for the young generation and also create new employment avenues for the youth. Hence in the budget, it is proposed to set up the task force for the AVGC promotion.

Increase in Defence Allocation
The frequent border tensions due to the aggression of China and Pakistan have prompted an increase of 10 per cent in this year’s budget allocation at Rs 5.25 lakh crore. The proposal to reserve 25 per cent of the defence allocation to the R&D budget for industry, start-ups, and academia will be a game-changer.

Would have been better if ….
The Budget 2022-23 would have been much better if honest income taxpayers had got some relief by increasing the standard deduction and Micro and small industries were given concessional rates of credit.

Dr S R Keshava (The writer is Professor of Economics, Bangalore University. Views are personal)

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